Matrix Service pany(US:MTRX)2023-09-12 20:57Financial Performance - Consolidated revenue for fiscal 2023 was $795.0 million, an increase of $87.2 million (12.3%) compared to $707.8 million in fiscal 2022[149]. - Gross profit for fiscal 2023 was $30.8 million, compared to a gross loss of $1.2 million in fiscal 2022, resulting in a gross margin of 3.9%[150]. - The company reported a net loss of $52.4 million in fiscal 2023, an improvement from a net loss of $63.9 million in fiscal 2022, translating to losses of $1.94 and $2.39 per fully diluted share, respectively[156]. - Adjusted EBITDA for fiscal 2023 was reported at $(17.7) million, an improvement from $(45.6) million in fiscal 2022, indicating a trend towards better operational performance[175]. - The effective tax rate for fiscal 2023 was 0.8%, a significant change from (9.6)% in fiscal 2022, influenced by valuation allowances on deferred tax assets[155]. - The company recognized a goodwill impairment of $12.32 million in the second quarter of fiscal year 2023, while no impairment was recorded in the fourth quarter[251]. - The net loss for the fiscal year 2023 was $52.36 million, an improvement from a net loss of $63.90 million in fiscal year 2022[256]. - Basic loss per common share for fiscal year 2023 was $1.94, compared to $2.39 in fiscal year 2022[256]. Revenue Segments - Revenue for the Storage and Terminal Solutions segment increased by $22.9 million to $255.7 million in fiscal 2023, driven by higher volumes of specialty vessel capital projects and tank repair work[157]. - The Utility and Power Infrastructure segment's revenue decreased to $169.5 million in fiscal 2023 from $220.1 million in fiscal 2022, primarily due to lower volumes of natural gas utility peak shaving work[160]. - Revenue for the Process and Industrial Facilities segment rose by $115.0 million to $369.8 million in fiscal 2023, attributed to increased activity in biodiesel facility projects and refinery maintenance[162]. - Revenue from fixed-price contracts was $419.426 million in 2023, a slight decrease from $421.188 million in 2022[322]. - Revenue from time and materials and other cost reimbursable contracts increased significantly to $375.594 million in 2023 from $286.592 million in 2022, marking a growth of 31.1%[322]. Backlog and Project Awards - The backlog at the end of fiscal 2023 was $1.1 billion, the highest level since fiscal 2019, with project awards totaling $1.3 billion during the year[138]. - The Storage and Terminal Solutions segment saw a backlog increase of 38.7%, with project awards of $354.5 million in fiscal 2023[144]. - The Utility and Power Infrastructure segment experienced a backlog increase of 350.2%, with project awards of $527.0 million in fiscal 2023[145]. - The Process and Industrial Facilities segment's backlog increased by 23.1%, with project awards of $444.1 million in fiscal 2023[146]. - As of June 30, 2023, the company had $459.7 million of remaining performance obligations yet to be satisfied, with an expectation to recognize approximately $381.0 million as revenue within the next twelve months[316]. Cash Flow and Liquidity - Unrestricted cash and cash equivalents totaled $54.8 million as of June 30, 2023, with total liquidity amounting to $92.5 million when including availability under the ABL Facility[176]. - Cash provided by operating activities for the fiscal year ended June 30, 2023 totaled $10.2 million, with a net loss of $52.4 million[184]. - Liquidity at June 30, 2023 was $92.6 million, a decrease from $94.8 million at June 30, 2022[28]. - The company generated $6.5 million from asset sales, including $6.3 million from the sale of its industrial cleaning business[28]. - The company maintains a minimum of $25.0 million of restricted cash at all times as required by the ABL Facility[294]. Expenses and Impairments - Consolidated Selling, General and Administrative expenses were $68.2 million in fiscal 2023, slightly up from $67.7 million in fiscal 2022[151]. - Goodwill impairment recorded in fiscal 2023 was $12.3 million, compared to $18.3 million in fiscal 2022[151]. - The gross margins in fiscal 2023 were negatively impacted by under recovery of construction overhead costs and increased forecasted costs to complete certain projects[150]. - The company has three reporting units with a combined total of $20.9 million of goodwill at higher risk of future impairment, with estimated fair values exceeding carrying values by 11% to 28%[252]. Capital Expenditures and Investments - Capital expenditures for the fiscal year ended June 30, 2023 were $9.0 million, primarily for construction and transportation equipment[187]. - The company experienced a gain on the sale of property, plant, and equipment amounting to $2.841 million in 2023, compared to a loss of $33.114 million in 2022[267]. - Stock-based compensation expense was $6.791 million in 2023, compared to $7.877 million in 2022, reflecting a decrease in compensation costs[273]. Accounting and Reporting - The company utilizes the percentage-of-completion method to measure progress on fixed-price contracts, which is based on costs incurred to date compared to total estimated costs[203]. - The company reassesses variable consideration each accounting period until uncertainty is resolved, with changes accounted for prospectively as cumulative adjustments to revenue recognized[201]. - The company measures progress on fixed-price contracts using the percentage-of-completion method, which is based on costs incurred to date compared to total estimated costs at completion[248]. - Deloitte & Touche LLP issued an unqualified opinion on the company's internal control over financial reporting as of June 30, 2023[235]. - The company's management assessed the effectiveness of internal control over financial reporting as of June 30, 2023, concluding it was effective[231].